TULSA, Okla., April 6 /PRNewswire-FirstCall/ -- ONEOK, Inc.
(NYSE:OKE) and Northern Border Partners, L.P. (NYSE:NBP) today
announced they have completed a series of transactions that result
in ONEOK owning 100 percent of the general partner interest and
45.7 percent of Northern Border Partners. "With the completion of
these transactions, ONEOK and the partnership are well positioned
to grow," said David Kyle, ONEOK chairman, president and chief
executive officer. "ONEOK will benefit from the expected growth of
the partnership, both by acquisition and from internally generated
projects. We firmly believe that our interests are clearly aligned
with the limited partners and are very excited about the future."
In connection with the completion of the transactions, the
following management changes were announced: * David Kyle, ONEOK
chairman, president and chief executive officer, will also serve as
chairman and chief executive officer of Northern Border Partners. *
John W. Gibson, president of ONEOK Energy Companies, will become
president and chief operating officer of the partnership. William
Cordes, chief executive officer of the partnership, will become
president, Northern Border Pipeline, reporting to Gibson. * Other
partnership officers include: James C. Kneale, ONEOK executive vice
president - finance and administration and chief financial officer,
assumes additional responsibilities as chief financial officer of
the partnership; Jerry Peters, chief financial officer of the
partnership, becomes senior vice president, chief accounting
officer and treasurer of the partnership; John R. Barker, ONEOK
senior vice president and general counsel, assumes additional
responsibilities as general counsel and secretary of the
partnership; and Janet Place, general counsel of the partnership,
becomes general counsel of Northern Border Pipeline, and associate
general counsel and assistant secretary of the partnership. As
previously announced, the partnership's policy committee intends to
consider an increase of $0.13 to $0.15 per unit in the quarterly
distributions to unit holders, which, at the indicated potential
distribution level, would exceed the maximum general partner
incentive distribution target. A portion of that increase could be
included in the first-quarter distribution, payable in May. ONEOK
and the partnership previously increased their 2006 earnings
guidance in anticipation of the closing of these transactions.
ONEOK expects its 2006 net income per diluted share to be in the
range of $2.30 to $2.36. The partnership's 2006 estimated net
income is expected to range from $426 million to $446 million, or
$4.43 to $4.69 per unit, and includes a one-time gain of $108
million, or $1.44 per unit, on the sale of the 20 percent interest
in Northern Border Pipeline. Distributable cash flow is expected to
be in the range of $324 million to $344 million, or $3.96 to $4.23
per unit. In separate transactions completed today: * ONEOK,
through its wholly owned subsidiary Northern Plains Natural Gas
Company, purchased a TransCanada Corp. affiliate's 17.5 percent
general partner interest, increasing ONEOK's ownership of the
general partner interest to 100 percent. The purchase price was $40
million, less $10 million for potential expenses associated with
the transfer of operating responsibility of Northern Border
Pipeline Company to TransCanada. * ONEOK transferred to the
partnership its entire gathering and processing, natural gas
liquids, and pipelines and storage segments in a $3 billion
transaction. ONEOK received approximately $1.35 billion in cash and
36.5 million limited partner units. The limited partner units and
the related general partner interest contribution are valued at
$1.65 billion. ONEOK owns approximately 37.0 million limited
partner units, which when combined with its 100 percent general
partner interest, increases its total ownership in the partnership
to 45.7 percent. * The partnership sold to TC PipeLines, LP, a
publicly traded partnership affiliated with TransCanada, a 20
percent interest in Northern Border Pipeline Company for
approximately $300 million. The price of the 20 percent interest,
along with a related share of Northern Border Pipeline's
outstanding debt, totals $420 million. As a result, Northern Border
Partners and TC PipeLines, LP, will each own a 50-percent interest
in the pipeline, with an affiliate of TransCanada becoming operator
of the pipeline in April 2007. To finance the transactions, the
partnership has obtained $1.1 billion, 364-day bridge-financing and
renegotiated its credit revolver, expanding the facility to $750
million for a new five-year term. ONEOK intends to use $40 million
of the $1.35 billion cash proceeds from the transactions to acquire
the general partnership interest from TransCanada, with the
remainder being used to reduce short-term debt, acquire other
assets or repurchase ONEOK common stock. ONEOK, Inc. is a
diversified energy company. We are among the largest natural gas
distributors in the United States, serving more than 2 million
customers in Oklahoma, Kansas and Texas. We are a leader in the
gathering, processing, storage and transportation of natural gas in
the mid-continent region of the U.S. and own one of the nation's
premier natural gas liquids (NGL) systems, connecting much of the
NGL supply in the mid-continent with two key market centers. Our
energy services operation focuses primarily on marketing natural
gas and related services throughout the U.S. ONEOK is the majority
general partner of Northern Border Partners, L.P., one of the
largest publicly traded limited partnerships. ONEOK is a Fortune
500 company. For information about ONEOK, Inc. visit the Web site:
http://www.oneok.com/ . Northern Border Partners, L.P. is a
publicly traded partnership whose purpose is to own, operate and
acquire a diversified portfolio of energy assets. The Partnership
owns and manages natural gas pipelines and is engaged in the
gathering and processing of natural gas. More information can be
found at http://www.northernborderpartners.com/ . Some of the
statements contained and incorporated in this press release are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Acts of 1995. The forward-looking
statements relate to both ONEOK and Northern Border Partners, L.P.
and apply to: anticipated financial performance, including
anticipated operating income from the businesses ONEOK acquired on
July 1, 2005, from Koch Industries, Inc. and affiliates, and the
businesses to be acquired by Northern Border Partners from ONEOK in
the transactions; management's plans and objectives for future
operations; business prospects; outcome of regulatory and legal
proceedings; market conditions and other matters. The Private
Securities Litigation Reform Act of 1995 provides a safe harbor for
forward-looking statements in certain circumstances. The following
discussion is intended to identify important factors that could
cause future outcomes to differ materially from those set forth in
the forward-looking statements. Forward-looking statements include
the items describing increased 2006 guidance in the preceding
paragraphs, the information concerning possible or assumed future
results of operations and distribution levels and other statements
contained or incorporated in this press release generally
identified by words such as "anticipate," "estimate," "expect,"
"forecast," "intend," "believe," "projection" or "goal." You should
not place undue reliance on forward-looking statements. Known and
unknown risks, uncertainties and other factors may cause actual
results, performance or achievements to be materially different
from any future results, performance or achievements expressed or
implied by the forward- looking statements. Those factors may
affect operations, markets, products, services and prices. In
addition to any assumptions and other factors referred to
specifically in connection with the forward-looking statements,
factors that could cause actual results to differ materially from
those contemplated in any forward-looking statement include, among
others, the following: * actions by rating agencies concerning the
credit ratings of ONEOK and Northern Border Partners; * the effects
of weather and other natural phenomenon on our operations,
including energy sales and prices and demand for pipeline capacity;
* competition from other U.S. and Canadian energy suppliers and
transporters as well as alternative forms of energy; * the capital
intensive nature of our respective businesses; * the profitability
of assets or businesses acquired by us; * risks of marketing,
trading and hedging activities as a result of changes in energy
prices or the financial condition of our counterparties; * economic
climate and growth in the geographic areas in which we each do
business; * the uncertainty of estimates, including accruals and
cost of environmental remediation; * the timing and extent of
changes in commodity prices for natural gas, natural gas liquids,
electricity and crude oil; * the effects of changes in governmental
policies and regulatory actions, including changes with respect to
income taxes, environmental compliance, authorized rates or
recovery of gas costs; * the impact of recently issued and future
accounting pronouncements and other changes in accounting policies;
* the possibility of future terrorist attacks or the possibility or
occurrence of an outbreak of, or changes in, hostilities or changes
in the political conditions in the Middle East and elsewhere; * the
risk of increased costs for insurance premiums, security or other
items as a consequence of terrorist attacks; * the impact of
unforeseen changes in interest rates, equity markets, inflation
rates, economic recession and other external factors over which we
have no control, including the effect on pension expense and
funding resulting from changes in stock and bond market returns; *
risks associated with pending or possible acquisitions and
dispositions, including our respective ability to finance or
integrate any such acquisitions and any regulatory delay or
conditions imposed by regulatory bodies in connection with any such
acquisitions and dispositions; * the results of administrative
proceedings and litigation, regulatory actions and receipt of
expected regulatory clearances involving the Oklahoma Corporation
Commission, Kansas Corporation Commission, Texas regulatory
authorities or any other local, state or federal regulatory body,
including the Federal Energy Regulatory Commission; * our
respective ability to access capital at competitive rates or on
terms acceptable to us; * the risk of a significant slowdown in
growth or decline in the U.S. economy or the risk of delay in
growth recovery in the U.S. economy; * risks associated with
adequate supply to the gathering and processing, fractionation and
pipeline facilities of Northern Border Partners, including
production declines which outpace new drilling; * the risk that
material weaknesses or significant deficiencies in our respective
internal controls over financial reporting could emerge or that
minor problems could become significant; * the impact of the
outcome of pending and future litigation; * the possible loss of
franchises or other adverse effects caused by the actions of
municipalities; * the impact of unsold capacity on Northern Border
Pipeline being greater or less than expected; * the ability to
market pipeline capacity on favorable terms, which is affected by:
-- future demand for and prices of natural gas; -- competitive
conditions in the overall natural gas and electricity markets; --
availability of supplies of Canadian and United States natural gas;
-- availability of additional storage capacity; weather conditions;
and -- competitive developments by Canadian and U.S. natural gas
transmission peers; * orders by the FERC which are significantly
different than our assumptions related to Northern Border
Pipeline's November 2005 rate case; * performance of contractual
obligations by the customers and shippers; * the ability to recover
operating costs, costs of property, plant and equipment and
regulatory assets in our FERC regulated rates; * timely receipt of
approval by FERC for construction and operation of the Midwestern
Gas Transmission Eastern Extension Project and required regulatory
clearances; * our ability to acquire all necessary rights-of-way
and obtain agreements for interconnects in a timely manner; * our
ability to promptly obtain all necessary materials and supplies
required for construction; * the composition and quality of the
natural gas we gather and process in our plants; * the efficiency
of our plants in processing natural gas and extracting natural gas
liquids; * renewal of the coal slurry pipeline transportation
contract under reasonable terms and our success in completing the
necessary rebuilding of the coal slurry pipeline; * the impact of a
potential impairment charges; * developments in the December 2,
2001, filing by Enron of a voluntary petition for bankruptcy
protection under Chapter 11 of the United States Bankruptcy Code
affecting our settled claims; * the ability to control operating
costs; * the risk inherent in the use of information systems in our
respective businesses, implementation of new software and hardware,
and the impact on the timeliness of information for financial
reporting; * acts of nature, sabotage, terrorism or other similar
acts causing damage to our facilities or our suppliers' or
shippers' facilities; * and the other factors listed in the reports
we each have filed and may file with the Securities and Exchange
Commission, which are incorporated by reference. Other factors and
assumptions not identified above were also involved in the making
of forward-looking statements. The failure of those assumptions to
be realized, as well as other factors, may also cause actual
results to differ materially from those projected. ONEOK and
Northern Border Partners have no obligation and make no undertaking
to update publicly or revise any forward- looking information.
Analyst Contact: Dan Harrison Analyst Contact: Jan Pelzer
918-588-7950 877-208-7318 Media Contact: Dan Harrison Media
Contact: Beth Jensen 918-588-7950 402-492-3400 DATASOURCE: ONEOK,
Inc.; Northern Border Partners, L.P. CONTACT: analysts and media,
Dan Harrison of ONEOK, Inc., +1-918-588-7950; or analysts, Jan
Pelzer, +1-877-208-7318, or media, Beth Jensen, +1-402-492-3400,
both for Northern Border Partners, L.P. Web site:
http://www.oneok.com/ http://www.northernborderpartners.com/
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